VATICAN CITY (AP) — A Vatican monsignor already on trial for allegedly plotting to smuggle 20 million euros ($26 million) from Switzerland to Italy was arrested Tuesday in a separate case for allegedly using his Vatican bank accounts to launder money.

Financial police in the southern Italian city of Salerno said Monsignor Nunzio Scarano, dubbed “Monsignor 500” for his purported favored banknotes, had transferred millions of euros in fictitious donations from offshore companies through his accounts at the Vatican’s Institute for Religious Works.

Acting on evidence provided by the Vatican bank, police said they seized 6.5 million euros in real estate and assets in Italian bank accounts Tuesday, including Scarano’s luxurious Salerno apartment, filled with gilt-framed oil paintings, ceramic vases and other fancy antiques.

A local priest was also placed under house arrest and a notary public was suspended for alleged involvement in the money-laundering plot. Police said in all, 52 people were under investigation.

Scarano’s lawyer, Silverio Sica, said his client merely took donations from people he thought were acting in good faith to fund a home for the terminally ill. He conceded, however, that Scarano used the money to pay off a mortgage.

“We continue to strongly maintain the good faith of Don Nunzio Scarano and his absolute certainty that the money came from legitimate donations,” Sica told The Associated Press.

The Salerno investigation was already under way when Scarano was arrested in June in Rome on the smuggling accusations.

Police and Sica have said the money involved in both the Swiss smuggling case and the Salerno money-laundering case originated with one of Italy’s most important shipping families, the d’Amicos. On Tuesday, financial police said more than 5 million euros had been made available to Scarano by the D’Amicos via offshore companies.